Authors: Anand Kumar, Debjit Roy, Vedat Verter and Dheeraj Sharma
Publication: European Journal of Operational Research, Vol 264, No. 1, January 2018
In developing countries, truck purchase cost is the dominant criteria for fleet acquisition-related decisions. However, we contend that other cost factors such as loss due to the number of en route truck stoppages based on a truck type and recovery cost associated with a route choice decision, should also be considered for deciding the fleet mix and minimizing the overall costs for long-haul shipments. The resulting non-linear model, with integer variables for the number and type of trucks, and the route choices, is solved via genetic algorithm. Using real data from a bulk liquid hazmat transporter, the trade-offs between the cost of travel, loss due to number of truck stoppages, and the long-term recovery cost associated with the risk of exposure due to a hazmat carrier accident are discussed. The numerical experiments show that when factors related to public safety and truck stoppages are taken into account for transportation, the lowest total cost and optimal route choice do not align with the cheapest truck type option; rather, the optimal solution corresponds to another truck type and route with total costs significantly less than the total costs associated with the cheapest truck type. Our model challenges the current truck purchasing strategy adopted in developing countries using the cheapest truck criteria.
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